Financial Review: Brookline Bancorp (BRKL) and J P Morgan Chase & Co (JPM)

Brookline Bancorp (NASDAQ: BRKL) and J P Morgan Chase & Co (NYSE:JPM) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, profitability, analyst recommendations, institutional ownership and valuation.

Dividends

Brookline Bancorp pays an annual dividend of $0.36 per share and has a dividend yield of 2.3%. J P Morgan Chase & Co pays an annual dividend of $2.24 per share and has a dividend yield of 2.1%. Brookline Bancorp pays out 46.2% of its earnings in the form of a dividend. J P Morgan Chase & Co pays out 32.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. J P Morgan Chase & Co has raised its dividend for 6 consecutive years.

Earnings and Valuation

This table compares Brookline Bancorp and J P Morgan Chase & Co’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brookline Bancorp $262.32 million 4.59 $52.36 million $0.78 20.13
J P Morgan Chase & Co $105.49 billion 3.44 $24.73 billion $6.97 15.01

J P Morgan Chase & Co has higher revenue and earnings than Brookline Bancorp. J P Morgan Chase & Co is trading at a lower price-to-earnings ratio than Brookline Bancorp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Brookline Bancorp and J P Morgan Chase & Co’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brookline Bancorp 19.82% 7.52% 0.87%
J P Morgan Chase & Co 24.08% 11.68% 1.06%

Insider & Institutional Ownership

77.7% of Brookline Bancorp shares are held by institutional investors. Comparatively, 73.9% of J P Morgan Chase & Co shares are held by institutional investors. 2.9% of Brookline Bancorp shares are held by insiders. Comparatively, 0.9% of J P Morgan Chase & Co shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Brookline Bancorp has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500. Comparatively, J P Morgan Chase & Co has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Brookline Bancorp and J P Morgan Chase & Co, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brookline Bancorp 0 3 1 0 2.25
J P Morgan Chase & Co 2 13 15 0 2.43

Brookline Bancorp currently has a consensus price target of $15.83, suggesting a potential upside of 0.85%. J P Morgan Chase & Co has a consensus price target of $91.38, suggesting a potential downside of 12.65%. Given Brookline Bancorp’s higher possible upside, equities analysts plainly believe Brookline Bancorp is more favorable than J P Morgan Chase & Co.

Summary

J P Morgan Chase & Co beats Brookline Bancorp on 11 of the 17 factors compared between the two stocks.

About Brookline Bancorp

Brookline Bancorp, Inc. operates as a multi-bank holding company for Brookline Bank and its subsidiaries; Bank Rhode Island (BankRI) and its subsidiaries; First Ipswich Bank (First Ipswich) and its subsidiaries, and Brookline Securities Corp. As a commercially focused financial institution with 50 full-service banking offices throughout greater Boston, the north shore of Massachusetts and Rhode Island, the Company, through Brookline Bank, BankRI and First Ipswich (individually and collectively the Banks), offered a range of commercial, business and retail banking services, including cash management products, online banking services, consumer and residential loans and investment services throughout central New England, as of December 31, 2016. The Company also provides specialty equipment financing through its subsidiaries, Eastern Funding LLC and Macrolease Corporation.

About J P Morgan Chase & Co

JPMorgan Chase & Co. is a financial holding company. The Company is engaged in investment banking, financial services. It operates in four segments, as well as a Corporate segment. Its segments are Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset Management. The Consumer & Community Banking segment offers services to consumers and businesses through bank branches, automatic teller machines (ATMs), online, mobile and telephone banking. The Corporate & Investment Bank segment, comprising Banking and Markets & Investor Services, offers investment banking, market-making, prime brokerage, and treasury and securities products and services to corporations, investors, financial institutions, and government and municipal entities. The Commercial Banking segment provides financial solutions, including lending, treasury services, investment banking and asset management. The Asset Management segment comprises investment and wealth management.

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